Ophir Energy closes acquisition of Santos’ Asian assets

London-listed Ophir Energy has completed the acquisition of Santos Limited’s producing assets in South East Asia.

Santos said on Friday that the transaction was completed for cash proceeds of $144 million.

The sum represents the sale price of $221 million after standard adjustments including net free cash flows generated by the assets and received by Santos from the transaction effective date of January 1, 2018, through to completion.

Santos sold interests in the Sampang PSC and Madura Offshore PSC in Indonesia, and Vietnam Block 12W PSC. Completion for certain exploration assets in Bangladesh, Malaysia, and Vietnam remains subject to customary consents and regulatory approvals expected in the coming months.

Santos said in previous statements that the producing assets sold were relatively late-life and were not prioritized for capital in the Santos portfolio. Santos’ share of production from the assets in the first quarter of 2018 was 1.4 million barrels of oil equivalent.

In a separate statement on Thursday, Ophir said that the cash flows generated by the producing assets in 2018 have been better than the company’s expectations, owing to higher than expected commodity prices over the period and production from the Chim Sáo field in Vietnam outperforming.

According to the company, completion of the exploration assets buy is expected in 2019, conditional upon among other things certain partner consents and their respective pre-emption regimes.

Interim CEO of Ophir, Alan Booth, said: “I am delighted that we have completed the acquisition of the producing assets from Santos and would like to extend a warm welcome to our new colleagues.

“The transaction represents an attractive next step in our strategy, adding a portfolio of high quality production and development assets‎ that further enhance the cash flow characteristics of Ophir.”

The buy will add around 13,500 boepd of net working interest production to Ophir in 2018 and approximately 21.2 MMboe to Ophir’s net working interest reserves.

To remind, Ophir received shareholder approval for the acquisition of Santos’ South East Asia assets in late August.

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